Austria: Troubled Affluence

AUSTRIA Troubled Affluence

On the surface, Maine-sized Austria hums with gemütlich prosperity. Unemployment shrank last year to a negligible 2%, and wages rose faster (10%) than the cost of living (6%). Last week pre-Easter shoppers crowded Vienna's Kärntnerstrasse, splurging on everything from spring ski sweaters to imported delicacies like pâte de foie gras and French Beaujolais. Swarms of Volkswagens, Fords and Austrian-built Puchs choked the streets of downtown Vienna, where private autos were a rarity only ten years ago. Travel reservations for the Easter holiday were virtually unobtainable.

Despite such symptoms of affluence, the Austrian economy is in trouble. In sharp contrast...

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